If you’re in a tight spot and considering the option of a title loan, then chances are that you have a lot of questions. Of course, your finances don’t always go your way and therefore you need a quick, stress-free solution to your problem. You need to know what title loans are, how they work, and everything in between. So be sure to understand these four important facts before making any loan choices.
1. What Is a Title Loan?
A title loan is a loan that you obtain by borrowing against the value of your vehicle. Essentially, your vehicle becomes collateral for the loan funds you need. Furthermore, the amount of your title loan is based on what your vehicle is worth. This value will be calculated by the loan provider during your application process.
2. What Is the Difference Between a Regular Loan and a Title Loan?
First, a title loan provider will generally not check your credit score during the application process. Compare this with the regular loan process that thoroughly checks your credit score and bases your approval on your credit history. Secondly, applying for and receiving a title loan tends to be a quick process. The best providers of auto title loans will disburse the money in 24 hours or less. On the other hand, a regular loan can take weeks, even months, to fully process. Lastly, a title loan is a great option if you need quick cash but perhaps not in a huge amount. In comparison, a regular loan is sometimes a large sum to purchase things such as a car or house.
3. What Do I Need to Apply for a Title Loan?
As a rule of thumb, the best title loan providers out there will process your application and grant you approval within a 24-hour time frame. Most importantly, you’ll need a government-issued driver’s license or passport. Then you will need to prove your residency (with an electric bill, for example). Third, you will need to provide a few references and their contact information. Finally, you will need to have your own vehicle with ownership in your name and provide specific information from the vehicle’s title.
4. Where Can I Apply for a Title Loan?
There are three easy ways that you can apply for a title loan with two being right from your own house! First, you can contact a title loan provider, speak with a customer service representative, and apply for a title loan over the phone. Or you can go directly to a title loan branch and complete the application process in person. Lastly, you can select a title loan provider on the Internet and complete your application online.
If you’re strapped for cash and considering a title loan as the solution, it’s vital to first understand the basics. Based on these four significant pieces of advice, you’re now informed and ready to make a choice that’s best for you.